RCom default: NCLAT dismisses contempt petition against Anil Ambani

The NCLAT on Tuesday dismissed contempt petitions filed against Reliance Group Chairman Anil Ambani and other officials by minority shareholders, alleging non-payment of dues by Reliance Infratel.

A two-member bench headed by NCLAT Chairman Justice S J Mukhopadhaya dismissed the pleas against Ambani and officials after observing that consent terms agreed upon between RCom and minority shareholders, including HSBC Daisy Investments (Mauritius), for payment of dues can not be a ground for initiation of contempt proceedings.

"We find that no case is made out for initiation of contempt proceedings against any of the alleged 'Contemnors' 'Respondents'...Both the applications are accordingly dismissed," the NCLAT said.

The appellate tribunal also said that it has not gone into merit and allowed the appeal to be withdrawn on May 29, 2018 after the minority shareholders and RCom reached settlement.

The National Company Law Appellate Tribunal (NCLAT) also said although both the parties had reached the final consent terms, but there was no undertaking given by any party before "this Appellate Tribunal nor any direction was issued".

"On bare perusal of pleadings made in the present petitions, we find that Petitioners filed the Contempt Petitions for execution of their consent terms', which will be apparent from the fact that companies namely Reliance Communications Infrastructure Limited'; Reliance Infratel Limited' and RCom, have also been impleaded as contemnors, though it is not maintainable against the companies," the tribunal said.

Earlier on July 3, the NCLAT had reserved its order, saying that it will decide whether the contempt petitions filed by HSBC Daisy Investments (Mauritius) and others should be admitted as Reliance Communications (RCom) is going through insolvency proceedings.

Reliance Infratel, is a subsidiary of RCom, and is presently under corporate insolvency resolution process.

HSBC Daisy had moved the appellate tribunal over alleged default of payment of Rs 230 crore by Reliance Infratel.

As per the consent terms of the agreement among Reliance Infratel, HSBC Daisy and others, recorded by the NCLAT in its order dated June 26, 2018, the Anil Ambani-owned firm was to pay the amount in the following six months.

After the six-month period ended, HSBC Daisy and nine other minority shareholders holding 4.26 per cent stake in Reliance Infratel filed the contempt plea.

The counsel appearing for resolution professional said that as RCom was going through insolvency proceedings and was under the moratorium period under the IBC, it cannot pay money.

In May this year, the Mumbai-bench of the National Company Law Tribunal (NCLT) started the corporate insolvency resolution process of RCom, which has a total bank debt of over Rs 50,000 crore.